China may be growing fast, but not equally fast everywhere.
In a US Department of Agriculture Economic Research Service study of Chinese growth ("China: A Study of Dynamic Growth"), Mathew Shane and Fred Gale explain that:
A third major structural imbalance [the other two are the "troubled banking system," and "state-owned enterprises" - Ben] is the degree to which development has been concentrated in a few major coastal areas, with less growth occurring in the rural, central, and western regions. Living standards in some coastal cities are approaching those of middle income countries, while other cities lag far behind (fig. 6). In 2003, urban per capita income was more than three times the rural average, up from twice the rural average during the 1980s (fig. 7). In 2000, China embarked on a “develop the west” campaign to push both public and private investment into the country’s poorest western provinces. In 2004, the party and central government leadership issued a “No. 1 Document” that made increasing rural incomes a top policy priority. Major policy initiatives in 2004 included a phase-out of agricultural taxes and direct subsidies of $1.2 billion to grain producers in 13 of China's 31 provinces. (pages 14-15)
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